If you do believe in it being a necessity, then you should now be planning on purchasing a policy for your own. Or if in case you’re already insured, this article will be helpful in understanding it, specifically car insurance coverages, more clearly.

There are different kinds of coverages and all have there specific way of insuring a policy holder depending on certain situations. And to properly understand these coverages, listed below are five with their respective explanations:

1. Liability Coverage. It is the kind that works by insuring a policy holder from paying medical and property repair expenses if in case that policy holder is the one at fault to the accident. It will pay for the medical and property repair expenses for the other party/s’ persons injured and property damaged. Liability coverage, which is offered or provided by different auto insurance companies, is typically characterized into two separate or sometimes joined coverages, which are:

a. Property Damage Liability. This pays for necessary property repair expenses that are needed by the property of the other party/s involved in the accident.

b. Bodily Injury Liability. This is responsible in paying for all the medical expenses needed for curing bodily injuries suffered by all in other party/s involved in the accident.

2. Personal Injury Protection (PIP). PIP, which is required in most states, insures a policy holder, all his/her passengers, and/or anyone he/she authorize to drive his/her car in case any accident occurs from paying medical expenses, which include rehabilitation, funeral expenses if necessary, and even paying for lost wages.

3. Collision and Comprehensive Coverage. This coverage is sometimes separated or joined into a single coverage like the liability coverage depending on car insurance companies. For Collision, it insures the policy holder’s car from damages that are incurred in a collision, either with a moving or stationary object. While for Comprehensive, insures the policy holder’s property from damages incurred from non-collision related accidents, like severe weather condition, etc.

4. Fire and Theft Coverage. This one also covers a policy holder’s property in situations where the property is stolen or totaled due to fire.

5. Underinsured and/or Uninsured Motorist Coverage. This one will insure a policy holder, his/her family and property in case he/she gets involved in an accident with a motorist who can either be a totally uninsured, or if insured has only minimal amount of coverage.

All the above mentioned coverages are offered by different auto insurance companies, and are all designed to give protection to a policy holder, and his/her family and property.